§ 16613 Treasurer'S Indemnity Bond Requirement

• •The state Treasurer can ask banks or credit unions to get a special insurance (called an indemnity bond) to protect the state's money.
• •This insurance must cover any loss if the bank's deposited securities lose value.
• •The people guaranteeing this insurance cannot be owners of the bank or credit union.

A credit union holds the state's money and uses some stocks as security. If those stocks lose value, the state could lose money.

The Treasurer can make the credit union get insurance to cover this loss. The people backing this insurance can't own part of the credit union.